Bitcoin bubble: how to get ready for the next crypto-crash

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Bitcoin is not immune to crashes however, and tends to wax and wane as effects from economies and political uncertainty create bubbles of over payment and speculation from eager investors hoping not to miss out on the next bubble.

As China’s example shows, countries can turn against cryptocurrencies, but as Russia’s example of the CryptoRuble shows, countries can also warm up to them after a period of opposition and hostility.

So, what can investors do?

While Bitcoin’s price is surging, invest in Ripple and Ethereum and wait.

When Bitcoin’s price next crashes, buy some and hold it. Investors are usually attracted to round numbers like $1,000, so why not buck the trend and set your buy-in threshold to something unusual like $922 lower than it is currently? The same holds true of other cryptocurrencies – consider an automated buy-in when there’s another sell-off.

Everyone is waiting for the emergence of a cryptocurrency to buy actual commodities with, and not just computer parts or e-cigarettes. Watch for the first true establishment cryptocurrency, headed by big names in the financial sector or backed by a country like Russia that will filter through to the rest of the financial ecosystem.

It should be noted that SEB, the Swedish bank, used Ripple’s system to transfer $180m between Sweden and the US in recent months to help manage the bank balance of a large corporate customer.

Given the nature of international cash flow and the increasing interconnected nature of electronic and financial infrastructure, it’s reasonable to predict that national barriers and fees will be further eroded by internet-based transactions.

People expect payments to be immediate, reliable and low-cost, and they will vote with their electronic wallets.